What Almost No One Knows About Taxes
Failure to meet your tax obligations has an ultimate price to pay which is penalties. The biggest fear any taxpayer has is the fear of being penalized. It is an additional burden to be penalized considering that one fails to pay his taxes due to financial problems. These people, however, can have a way of evading the penalties. The way to avoid the penalties is through tax reliefs.
Tax relief are ways of keeping off penalties in the case of delayed tax payments. Tax collecting authorities try as much as possible to keep these methods of tax relief from the public. The accessibility of the information regarding tax reliefs is however not entirely impossible. There are seven established methods of tax relief namely bankruptcy, hardships, making partial payments, streamline pay agreements, penalty abatement, offer in compromise and the amendment of own tax obligation. Below are three of the most effective tax relief methods among the seven.
The first and the surest way of getting a tax relief is bankruptcy. Part or the whole of a person’s tax debt may be lifted if a person or institution is declared bankrupt. This is because there is no way of meeting these tax obligations. However, if you apply for a tax relief when in the middle of applying or filing for bankruptcy, there is a high possibility of being denied the tax relief. A clear guidance on applying for this type of relief can be given by your attorney.
The other way of getting tax relief is when you are undergoing temporary or permanent hardships. Tax obligations, as well as any penalties, are exempted from these people undergoing hardships by the tax collecting body. Some hardships considered by tax collection authorities may include being hit by disasters like earthquakes and tsunamis; having a permanent medical condition that affects your income generation among many others. Being in such a situation, one should file for a tax relief in order to be exempted from the pending penalties and other tax obligations.
The third way of acquiring tax relief is partial pay agreements with the tax collector. Since full payment of the taxes can be difficult, this agreement allows you to pay them on a monthly basis. Once accepted, you will then be able to make little agreed minimum payment of your owed taxes. When tax payment takes a large amount of your income making you unable to meet your other needs or run your business, this is the method to use. Though very little is known about this and the other methods of obtaining tax reliefs, all of them are genuine ways of getting tax reliefs.